Providing for children through estate planning

Nearly every Nevada parent wants to support his or her children. That same parent can also provide for his or her children after death through estate planning. An individual does not have to have a large amount of wealth to do so.

The first document necessary to any estate plan is a will. This document can name a guardian for minor children and specify who will receive certain assets after death. However, not every item a person owns has to be listed in his or her will. A separate letter can be referenced in the will that outlines who will receive certain items of personal property.

Retirement accounts and insurance policies are passed through beneficiary designations. These documents control who will receive the proceeds from such accounts regardless of what an individual’s will says. Therefore, it is important to keep them updated in order to ensure that the correct beneficiary receives the account upon death.

Some people may discover, as they go through the estate planning process, that additional documents are needed such as trusts. These documents can give the creator the control to determine when and how a beneficiary will receive distributions from the trust. Further, trusts are often used to protect an individual’s inheritance from creditors, tax collectors and ex-spouses.

These are not the only estate-planning options available to provide for family members, but they are some of the most popular estate-planning tools. Discussing what objectives a Nevada resident wants to achieve with someone familiar with estate planning could provide additional options. Once all of the documents are put in place, a parent and his or her children can have the peace of mind that planning ahead often provides.

Source: The Boston Globe, “How to pass money on to your children“, Jonnelle Marte, Nov. 5, 2014